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MONTHLY REVIEW OF B U S I N E S S C O N D IT IO N S JOHN PERRIN, Chairman of the Board and Federal Reserve Agent Federal Reserve Bank of San Francisco San Francisco, California, August 16, 1923 Vol. VII Summary of National Conditions Production of basic commodities and em ployment at industrial establishments de creased in July, and there was a further decline in wholesale prices. The distribution of goods, as indicated by railroad freight shipments, was maintained at record levels, and sales of mer chandise, though showing the usual seasonal decline, continued relatively heavy. Production. Production in basic industries, according to the index of the Federal Reserve Board, declined one point in July. Mill con sumption of cotton, steel ingot production, and sugar meltings were considerably smaller than in June. New building operations during the month, as measured by the value of permits granted and of contracts awarded, showed more than the usual seasonal decline. Employment at industrial establishments located in various sections of the country de PE R C E N T PE R C E N T 160 300r No. 8 creased two per cent during July. Manufac turers of automobile tires and cotton goods re ported large reductions in number of employees. There were some further announcements of wage advances, but these were not as numer ous as in the three previous months. Average weekly earnings of factory workers, due to a decrease in full time operations, were three per cent less than in June. Crop forecasts of the Department of Agri culture on the basis of condition on August 1st indicated that yields of wheat and rye would be below July estimates, while larger yields of cotton, corn, oats, and barley were forecasted. Due to seasonal increases in grain shipments and continued large shipments of industrial raw materials and manufactured goods, carloadings in the last week of July reached the largest total on record. Trade. The volume of wholesale trade was about the same in July as in June, while there M IL L IO N S OF D O LLA RS B I L L IO N S O F D O L L A R S 140 250 ,AI2I 120 \ 100 ■A 200 / \ \ 80 150 60 100 ^ 1 51 40 50 20 0 — 1— L_JU __LI..-!— -.1 1919 1920 1921 1922 1923 Index of Production in Basie Industries Com bination of 22 individual series corrected for seasonal variation (1919 average = 100 per cent) 0 X i i I 1920 1921 —L 1919 -L_ 1922 1923 Prices Bank Credit Bank Credit In dex num bers o f w h olesale prices. U n ited States Bureau o f Labor Statistics (1913 a v e r a 2 e = 1 0 0 per cent) All Federal R eserve Banks 800 m ember banks iu lead ing cities T h o se desiring this review sent th em regularly w ill receive it w ithout charge u p on application. 114 M O N T H L Y REVIEW OF BUSINESS CONDITIONS was a decline in retail trade, which was largely seasonal in nature. Am ong the wholesale lines, sales of dry goods and clothing were larger than in June, while sales of groceries, hard ware, and shoes were considerably smaller. Business in all reporting lines was larger than in July, 1922, the average increase as indicated by the Federal Reserve Board’s index of whole sale trade being 13 per cent. Retail sales of department stores were 10 per cent larger than a year ago, while mail order sales showed a gain of 27 per cent. Stocks of department stores showed a seasonal reduction during July, and were smaller than in any month since January. Prices. Wholesale commodity prices de clined during July for the third consecutive month, and the index of the Bureau of Labor Statistics was 5 per cent below the April peak. Prices of all groups of commodities, except house furnishings, were lower in July than in June. The largest declines occurred in prices of clothing, drugs and chemicals, farm prod ucts, and building materials. During the first half of August, price changes were more mod erate, and quotations on cotton, spring wheat, hogs, sheep, and rubber advanced. Bank Credit. Since the middle of June the volume of bank credit in use has shown a re duction, largely because of substantial liquida tions of loans on stocks and bonds at New York City banks. Between July 18th and August 15th loans of member banks in leading cities secured by stocks and bonds decreased by $94,000,000 to the lowest point for the year. On the latter date the total of such loans was $258,000,000 below the amount outstanding at the beginning of the year. Commercial loans of reporting member banks increased during the four week period ending August 15th, however, so that the net reduction in total loans for the period amounted to $60,000,000. Security investments declined $73,000,000 to a new low level for the year. The volume of discounted paper held at the Federal Reserve banks showed a slight de crease, while their holdings of acceptances and United States government securities reached new low points for the year. Between the middle of July and the middle of August, gold holdings of the Federal Reserve banks in creased by $21,100,000, reflecting in part net gold imports during July of $27,400,000. Fed eral Reserve note circulation increased by about $15,000,000, and there were also substan tial increases in the volume of gold certificates and national bank notes in circulation. Slightly firmer tendencies in money rates during the month were reflected in a gradually increasing proportion of commercial paper sales at 5J4 P^r cent, as compared with 5 per cent in the previous month. Summary of District Conditions The volume of business transacted through out the Twelfth District during July was con siderably larger than a year ago. Some falling off was reported in comparison with figures of the late spring of this year, but such a decline is a normal seasonal occurrence during the summer months. It is not clear to what extent the decline at this time is purely seasonal and to what extent, if any, it is due to actual cur tailment of business activity, but reports indi cate that most of the principal industries of the district were able, during the month, to adjust production to current demand without greatly reducing output from the record levels of the spring months of this year. Trade at retail, as indicated by sales of 35 department stores in 7 cities, was 19.8 per cent greater in value during July, 1923, than during July, 1922, the largest increase, as compared with the corresponding month a year ago, re ported since March, 1923. Stocks of merchan dise held by these stores are slightly larger than one year ago, but the rate of turnover is more rapid than it was at that time. All of the eleven lines of wholesale trade which report to this bank, excepting agricultural implements and automobile tires, transacted a larger vol ume of business during July, 1923, than during July, 1922, the increases in the value of their sales ranging from 7.5 to 20.3 per cent. Despite a decline which was in excess of the normal seasonal movement between June and July, debits to individual accounts at banks in 21 clearing house centers during the latter month were 18.4 per cent greater than one year ago. This increase is slightly less than that reported for the first six months of the present year, but is still in excess of the increase in prices over the year period, and undoubtedly indicates a substantial gain in the physical volume of busi ness transacted. Figures of the number and liabilities of business failures are now at nor mal levels. The number of failures in the dis trict was less in July than in June, 1923, and liabilities were less than in any month since May, 1921, excepting June, 1923. Production and shipment of lumber declined during July, but the amount of new business entered on the books of reporting mills in creased for the first time since April. This in crease in the demand for lumber came at a time when mills were completing delivery on the record volume of orders received during the first quarter of the year. A shortage of mill stocks of lumber is still reported in many sec tions. The effect upon production of continued dull markets and declining prices for the prin cipal metals produced in the district became apparent in the preliminary production figures 115 FEDERAL RESERVE AG EN T A T SAN FRANCISCO for July. The output of lead, silver, and zinc was noticeably curtailed, and although figures of copper production showed no decline from the previous month, reports of a reduction in output became increasingly frequent toward the close of the period. Further gains in the production of petroleum were reported from California during July, the record for the past two months standing as follows: Average daily production (bbls.) ................................. July, 1923 June, 1923 July, 1922 814,906 750,570 373,695 Shipments were far below production and stored stocks increased from 72,637,147 barrels on July 1st to 78,655,604 barrels on August 1st. Prices of both crude oil and gasolene were re duced on August 1st, and the latter product is now selling in Pacific Coast cities at the lowest levels since 1916. A slight decline in the vol ume of building under construction and a marked decline in prospective construction, as indicated by the number and value of building permits issued, was reported during the past month. That building continues extremely ac tive, however, is shown by the fact that the present and prospective volume of construction is considerably greater than it was one year ago, when the building industry was experienc ing a period of greater than normal activity. Shortages of certain classes of labor which seemed possible a month ago did not material ize during July. Laborers are everywhere re ported fully employed. Promise of bountiful yields of most of the principal crops of the district has been con tained in reports received from the harvest fields. The wheat crop which is now moving to market is the largest which has been pro duced in the district in recent years, present estimates forecasting a total yield of 136,739,000 bushels compared with 99,086,000 bushels produced in 1922, 126,548,000 bushels in 1921, and 105,307,000 bushels in 1920. Yields of the important fruit crops of the district are well up to the average of previous seasons, and transportation facilities for their rapid move ment to market are better than they have been for some years past. The general trend of all prices was down ward during July, the prices of most of the principal agricultural products of this district, particularly wheat and California fruits, shar ing in the general movement. Prices of nonagricultural products in many cases reached the low point of the present downward move ment during the month, and turned upward during its closing days or in the first weeks of August. Prices of lumber, lead, and zinc were included in this latter category. Building ma terials prices, according to the index number of the United States Department of Labor, decreased 2.06 per cent during the month and are now 6.8 per cent below the peak of April, 1923, although still 11.7 per cent higher than one year ago. Loans of reporting member banks of the dis trict increased by $16,000,000 during the fourweek period ending August 8th, and their de posits declined by $11,000,000 during the same period. These movements reflect, to a large extent, the credit needs of the district in har vesting and moving its crops. Total discounts of the Federal Reserve Bank declined $8,000,000 during the four weeks ending August 15th, and at $73,000,000 on the latter date were $42,000,000 above the low point of January 10, 1923. Investments of the reserve bank have declined since the first of the year by a greater amount than the increase in discounts, so that total earning assets were $23,000,000 less on August 15th than on January 10th. Crop Conditions Harvesting and threshing of the grain crops of the district has proceeded without serious interruption during the past month. Thresh ing of winter wheat has been practically com pleted in California, and is progressing rapidly in the Pacific Northwest. The spring wheat crop of the latter section is now ready for the harvest. As threshing returns have become more gen erally available the United States Department of Agriculture has revised previous estimates of the yield of wheat in this district, and on August 1st placed the total crop in its principal producing states at 135,430,000 bushels, com pared with a July 1st forecast of 131,847,000 bushels, and a final estimate of 97,453,000 bushels for the 1922 crop. Revised estimates of condition and yield are given for five states of this district and for the United States in the following table: Spring Wheat Condition Aug. 1st (P e r C ent o f N orm al) 1923 California ............. Idaho ................ 93 Oregon ............ 96 Utah ................. 95 W ashington . . 96 T o t a l s ................. United States. 69.6 1922 .. 82 62 89 50 .. 80.4 Forecasted Yield* A ll Wheat Aug.1,1923 July 1, 1923 (b u sh els) 16,456 28,657 26,056 6,059 58,202 135,430 793,376 Actual Yield* A ll Wheat 1922 (b u sh els) (b u sh els) 14,589 27,106 24,527 6,234 59,382 131,847 821,000 15,308 24,275 19,744 5,682 32,444 97,453 862,000 *000 omitted. The greater part of the barley crop in Cali fornia has been harvested and threshed, and the total output is now estimated at 36,292,000 bushels, compared with 36,864,000 bushels pro duced in that state in 1922. The relative inactivity in wheat markets of the district which characterized the 1922-1923 cereal year continued during the first month of the 1923-1924 season. Exports of wheat from Portland and the Puget Sound ports during 116 M O N T H L Y REVIEW OF BUSINESS CONDITIONS July, 1923, totaled 770,002 bushels, compared with a movement of 785,008 bushels in July, 1922, and 2,996,330 bushels in July, 1921. W heat prices declined slightly during July. On August 14, 1923, milling wheat on the San Francisco market was quoted at $1.75 to $1.85 per cental ($1.05 to $1.11 per bushel), com pared with $1.80 to $1.90 per cental ($1.08 to $1.14 per bushel) one month previous and $1.80 to $1.85 per cental ($1.08 to $1.11 per bushel) on August 14, 1922. Favorable weather stimulated the growth of most field crops in this district during July, according to the August 1st crop reports of the United States Department of Agriculture, and in many cases estimates of yields have been revised upward. The excellent condi tion of the sugar beet crop in California, Idaho, and Utah on August 1st indicated that the yield would be approximately 1,882,000 tons, compared with a July 1st forecast of 1.887.000 tons and a final estimate of 1,539,000 tons last year. Scattered improvement in the condition of the potato crop has resulted in an advance of the forecasted yield in Cali fornia, Idaho, Oregon, and Washington from 32.738.000 bushels on July 1st to 33,803,750 bushels on August 1st. The 1922 yield in these states was 40,740,000 bushels. The con dition of cotton on July 25th was 91 per cent of normal in Arizona and 88 per cent of nor mal in California, a slight decline from the reported condition on June 25th. Picking has commenced in the earlier maturing fields in Arizona and California. Cool weather dur ing much of the present growing season has retarded the development of rice in California. The reported condition of the crop in that state was 81 per cent of normal on August 1st, compared with 91 per cent a year ago and a ten year average of 91 per cent. Estimates based on the acreage and present condition of the growing crop indicate a yield of 5,571,000 bushels (2,506,950 bags of 100 pounds each) for this season. There were 8,260,000 bushels (3,717,000 bags) of rice grown in California last year. The bean crop in unirrigated sec tions of California has suffered slightly from a lack of water during the past month, the supply of soil moisture being deficient as a result of the uneven distribution of rainfall during the present year. A yield of 4,359,000 bushels of all varieties of beans is now fore casted, compared with a July 1st forecast of 4.470.000 bushels, and the 1922 production of 4.778.000 bushels. Deciduous fruit crops of the district are ma turing rapidly, and a large part of the crop has already been marketed. The condition and fore casted yields of the principal deciduous fruits grown in California changed but little during July, with the exception of the grape crop which suffered considerable damage from mil dew. The exact amount of the loss in yield is not yet ascertainable. Condition and yield fig ures for California fruits follow: Condition Forecasted Yield Aug. 1, July 1, Aug. 1, Aug. 1,1923 1923 1923 1922 (to n s ) , 82 7,069,000* ...102 102 59 210,000 ...97 92 91 ...88 96 96 1,653,000 ...72 75 50 ,. . . 9 2 92 96 393*000 ...80 80 80 112,000 ...99 97 79 .. .. 63 63 76 80,000 (P e r C ent o f N orm al) Apples* Apricots Grapesf Peaches Prunes Final Estimate of 1922 Yield Forecasted Yield July 1,1923 (to n s) (ton s) 6,977,000* 7,656,000* 1,743,000 1,660,000 5,400 420,000 125,000 46,000 210,000 120,000 12,000 393,000 112,000 110,000 80,000 *Total crop (commercial and non-commercial in boxes), tIncluding all varieties (table, wine, and raisin). In the Pacific Northwest large yields of most fruits are anticipated. Previous estimates of the 1923 commercial apple crop in Oregon and Washington have been increased, and the prob able yield is now placed at 31,065,000 boxes (bushels), compared with a yield of 25,092,000 boxes (bushels) in these two states last year. The Department of Agriculture's August 1st crop report forecasts a total commercial apple production of 98,631,000 bushels (boxes) in the United States. The 1922 commercial apple crop in the United States totaled 93,270,000 bushels (boxes). Prices obtainable for deciduous fruits, whether in the fresh fruit market, from canners, or in the dried form, have been lower than for some years past. Many growers, rather than accept prevailing prices for can ning and drying fruits, have shipped a larger proportion of their crops than usual to the fresh fruit markets. This tendency is in part responsible for the heavy railroad movement of California fruits thus far this season. Ship ments up to August 5th of the past two years are given in the following table: 1923 Season to Aug. 5th 1922 Season to Aug. 5th (cars) (cars) Apricots ..................... ...................... 682 Cherries ..................... ....................... 612 ....................... 611 ....................... 2,910 Pears ........................... ...................... 4,584 ....................... 4,988 ....................... 90 Totals ..................... ...................... 14,477 193 502 350 448 2,262 2,802 16 6,573 Transportation facilities for the movement of the perishable fruit crops of California have been adequate thus far this season. The rail roads have increased their refrigerator car and icing equipment, larger loads per car are being carried, and a faster schedule than in previous years is being maintained both in the move ment of loaded cars eastward and empty cars 117 FEDERAL RESERVE AG EN T A T SAN FRANCISCO westward. The railroads serving California re port that when the peak of the shipping season is reached in late August and early September, they will have approximately 44,475 refrigera tor cars in service. In addition to these cars owned by the western roads, it is estimated that from 6,000 to 7,000 refrigerator cars owned by lines in other parts of the country may be temporarily available for service here at the height of the season. There were approxi mately 42,000 refrigerator cars used during the 1922 fresh fruit shipping season in California, and 53,961 cars of fresh deciduous fruits were shipped from the state. Commercial estimates of the possible total movement this season range from 50,000 to 65,000 cars. Total shipments of oranges and lemons from California up to August 1st of the past two seasons have been reported as follows: N ov. 1st to Aug. 1st 1922-1923 1921-1922 (cars) (cars) Oranges ........................................... 42,106 Lem ons .............................................. 6,938 25,726 8,361 Canned and Dried Fruits Recent developments in the canned fruit in dustry have confirmed previous reports of a general tendency among canners to operate conservatively during the present season, and it still appears probable that the 1923 pack will be smaller than the record pack of last year. Reports from commercial factors state that the majority of the canners are limiting the amount of their pack to the volume of sales already completed or practically certain of completion. Up to the present time (August 16th) packers' purchases of canning fruit from the growers have been relatively small in vol ume, only the best grade and quality of fruit having been accepted. Stocks of unsold canned fruit from the pre vious year’s pack in California remain larger than at this time a year ago, and the volume of future sales during the current season has so far been smaller than during the corresponding period last year. Announcement of opening prices for canned fruits by most of the larger operators is reported to have stimulated ac tivity in the domestic market during the past month. Foreign demand is reported to be in active. The 1923 opening prices for canned fruits, recently announced by packers, conform in general to the spot prices which have prevailed during recent months, and range from 10 to 20 per cent below 1922 opening prices, excepting prices for blackberries and loganberries which are higher than last year. Opening prices of the largest factor in the trade for the past four years, and percentage comparisons of 1923 opening prices with 1922 opening prices are given in the following table: PerCMiaie Increase or Decrease (— ) 1923 (F . O. B. C an nery) Compared 1923 1921 1922 (p er d o z .) (p er d o z .) (p er d o z. ) with 1922 Opening Prices Choice Grade N o. 2i Cans 1920 (per d o z .) Apricots .......... $3.85 B lackberries . . 3.00 Cherries, Black 4.00 Cherries, R. A . 4.50 Grapes, Muscat 3.40 Loganberries*. 4.15 Peaches, Y . C.. 4.15 Peaches, Y . F . . 3.90 Pears, Bartlett. 4.65 Plums, E g g . . . 3.40 $2.60 2.35 2.25 3.00 3.00 2.35 2.35 2.35 2.30 3.15 2.00 $2.25 2.70 2.60 3.75 3.90 2.35 2.25 2.60 2.35 3.25 2.15 $2.20 2.15 3.00 3.15 3.25 2.10 3.10 2.25 2.10 2.65 1.85 — 2.2 — 20.3 15.3 — 13.3 — 16.7 — 10.6 37.8 — 13.4 — 10.6 — 18.5 — 13.9 *F . O. B. San Francisco. Present indications, as interpreted by lead ing marketing factors, point to a slightly smaller production than last year of the prin cipal dried fruits (excepting apricots) of this district. Commercial estimates place the yield of prunes at 80,000 tons in California and 22,500 tons in the Pacific Northwest, compared with estimated yields of 110,000 tons and 36,000 tons, respectively, in 1922. Preliminary esti mates of the production of dried peaches in California range from 5 to 15 per cent below the 1922 yield of 28,000 tons. Total production of dried apricots in California is at present placed at approximately 20,000 tons, compared with 10,250 tons produced last year. The size of the forthcoming raisin crop is still uncertain. Approximately 32,000 acres of young vines have come into bearing this year, and produc tion might therefore be expected to exceed that of 1922 (220,000 tons). The growing crop has been considerably damaged by mildew during the past six weeks, however, and insofar as this results in a loss of raisins rather than in a re duction of the amount of raisin grapes shipped to the fresh fruit market, the crop will be smaller than was anticipated earlier in the season. Carryover stocks of all classes of dried fruits remain larger than they were a year ago. The dried fruit market is reported to be rela tively inactive, despite recent price reductions ranging from 10 to more than 50 per cent for the various kinds and grades of fruits. Livestock Livestock pastures and ranges in California and the Pacific Northwest continue in excellent condition. In the Intermountain states where small losses of livestock, due to failing feed or water supplies, had previously been reported, conditions improved greatly during the latter part of July and the first weeks of August. 118 M O N T H L Y R EVIEW OF BUSINESS CONDITIONS Seasonal rains replenished water supplies and stimulated the growth of forage grasses. Receipts of all classes of livestock at eight principal markets in this district during July, 1923, were substantially larger than in July, 1922, but were less than receipts in June, 1923, this latter movement being a seasonal one. A noteworthy feature of the figures for July, 1923, as compared with July, 1922, was the large increase in receipts of hogs, amounting to 91.3 per cent for the eight reporting markets. Receipts of Livestock at Eight Principal Markets Calves Hogs Sheep July, 1923............... 66,013 Cattle 22,189 170,721 225,836 June, 1923............... 74,750 July, 1922............... 58,794 19,915 16,051 179,457 89,228 229,663 191,142 THO USANDS 500 400 Present stocks of cold storage butter in these markets are 34.7 per cent greater than on August 1, 1920, when total holdings amounted to 4,815,484 pounds, hitherto the highest figure reported since accurate records have been available. Butter prices on the San Francisco wholesale market advanced slightly during July and the first two weeks of August. On August 16th they were approximately 12 per cent higher than on August 16, 1922. During the past month large shipments of butter from Middle Western and Intermountain states have reached California markets, prices in that state having been relatively higher than in other sections of the country. There was a moderate increase in the hold ings of cold storage eggs during July. Total cold storage stocks of eggs in six principal mar kets of the district on August 1,1923, were 17.7 per cent greater than on August 1, 1922. A summary of the cold storage holdings of butter and eggs in the chief markets of the Twelfth Federal Reserve District is presented in the following table: Aug. 1, 1923 300 July 1, 1923 Junel, 1923 Au g. 1, 1922 Butter (pounds) 6,488,668 4,666,429 2,041,196 4,664,416 Eggs (c a s e s )... 665,208 633,519 514,751 564,901 200 100 Receipts of Livestock at Eight of the Principal Markets of the District 1922*1923. (Los Angeles, Ogden, Portland, Salt Lake City, San Francisco, Seattle, Spokane, and Tacoma included) Commercial reports continue to indicate an active demand for feeder and stocker animals of all classes in the markets of this district, par ticularly those in the Pacific Northwest. This demand is partly seasonal, due to the ready availability of feeds at this, the harvest period of the year. An upward tendency in hog prices was noted in the livestock markets of the dis trict during July. Prices for beef cattle, sheep and lambs remained relatively stable, although in California markets there was a tendency to wards rising prices. Dairy and Poultry Products Butter production in this district continued at a high level during July, and a large pro portion of the output was placed in cold stor age. The total holdings of cold storage butter in the four principal markets of this district, at 6,488,668 pounds on August 1, 1923, were 39.0 per cent greater than on July 1, 1923, and 39.1 per cent greater than on August 1, 1922. Prices The general trend of prices was downward during July, the prices of many of the principal agricultural products of this district participat ing in the movement. Quotations for livestock of all kinds in the central markets were lower at the close of the month than at its beginning and, with the exception of cattle, prices for livestock are now below those of one year ago. Prices of wool, wheat, sugar, and cotton moved toward lower levels during the month, but in the case of these products August 1st prices for all except wheat were still slightly above the figures quoted at the beginning of August, 1922. The steady decline in wheat prices which began in April reached a new low for the pres ent movement on July 28th, when September wheat was quoted at 95^4 cents per bushel on the Chicago market. Since that time wheat prices have advanced slightly. Spot middling upland cotton on the New Orleans market sold for 22 cents per pound on August 3, 1923, a decrease of 5 cents per pound from the price quoted on July 6, 1923, and but three-fourths of a cent per pound above the price on August 3, 1922. Granulated cane sugar, which was quoted at $9.45 per 100 pounds (San Francisco) on July 6th, dropped to $8.75 per 100 pounds on July 12th, advanced to $9.00 per 100 pounds on July 17th, and had declined to $7.90 per 100 pounds by August 16th. W ool prices in east ern markets have tended toward slightly lower 119 FEDERAL RESERVE AG EN T AT SAN FRANCISCO levels, but in the west there have not been enough sales recently to establish a market price. During the past month the principal canners of the district have announced 1923 opening prices for canned fruit ranging from 10 to 20 IN D E X NU M B ER S ________ Wholesale Prices and the Cost of Living. 1920-1923 U n ited States Bureau of Labor In dex of W h o le sa le Prices (1 9 1 3 = 1 0 0 ) N ational Industrial C on feren ce Board In dex o f the C ost of L iving (July 1 9 1 4 = 1 0 0 ) per cent below the prices named a year ago. In general the recently named prices approxi mate the spot prices for 1922 pack fruit which have prevailed during the past few months. The downward trend of dried fruit prices con tinued during the month. Present prices are from 10 to 25 per cent lower than one year ago. Greater price stability among the principal non-agricultural products of the district than for some time past was reported during July and early August. Prices of lead and zinc, which have been declining since April, reached a low point for the movement and turned definitely upward. Copper prices were un changed. Slight weakness in the lumber mar ket persisted, but prices strengthened during the first weeks of August. Figures of sixteen regularly reporting mill ing companies of this district show an in crease in production during July, 1923, as compared with the previous month and with July, 1922. A t 393,330 barrels, output of flour from these mills during July was 13 per (A ) Commodity Prices— Commodity Unit Tw enty Basic Commodities (F. R. B. of N. Y .) 1913=100. W holesale Prices (U . S. Bureau of Labor) 1 9 1 3 = 1 0 0 ______ Cost of Living (National Industrial Conference Board) July, 1914=100 Cattle (Native B e e f ) .. .W e ek ly average price at C h ica g o .. Sheep .................... ........... W eekly average price at C h ica g o .. Lambs .................. . . . . . .W e ek ly average price at C h ica g o .. H og s ..................... W h e a t .................. .Chicago contract price for Sept. W h e a t .. B a r l e y .................. .Shipping Barley f. o. b. San F ran cisco.. . Rice ...................... .California Fancy Japan at San Francisco C o t t o n .................. .M iddling Uplands— W eekly range of spot quotations at N ew O rleans...................... W o o l .................... .Average of 98 quotations at B osto n ......... Flour .................... .First Grade Family Patent f. o. b. Pacific Coast m i l l s ........................................................ Sugar ................... .Cane Granulated f. o. b. San F rancisco.. Oranges ............. .Valencias, Special Brands, Los Ang^eles. Lem ons ............... .Special Brands, L os A n g eles........................ Dried A p p le s___ .Choice in 50-lb. boxes f. o. b. California.. Dried A p ricots.. .Choice in 25-lb. boxes f. o. b. C aliforn ia.. Prunes ................ Size 40/50 in 25-lb. boxes f. o. b. C a lif... . Raisins ................ . Loose Muscatel in 25-lb. boxes f. o. b. California .......................................................... Canned Apricots.Choice, sliced, 2 % s f. o. b. C a lifo rn ia .... Canned Peaches. .Cling, Choice, sliced, 2 / s f. o. b. C alif... Canned Pears___ .Bartlett, Standard, 2 / s f. o. b. California Raw M ilk .............. .Pacific Coast— July average........................... Butter .....................93 score at San Francisco............................... Eggs .......................Extras— San F r a n c isc o ................................... Copper ................. .Electrolytic; N ew Y o rk S p o t...................... Lead .......................N ew Y o rk S p o t................................................... Silver ......................N ew Y o rk Foreign............................................ Z i n c ...................... ..East St. Louis S p o t............................................ Petroleum .............California 35° and above................................. Douglas F ir .........,2x4, 16 ft. N o. S1S1E f. o. b. Seattle......... Douglas F ir ____ .12x12 Tim bers f. o. b. Seattle........................ *1923 Crop prices. 1 1923 Opening prices. 100 lbs. 100 lbs. 100 lbs. 100 lbs. bu. cental cental lb. lb. bbl. lb. box box lb. lb. lb. lb. doz. doz. doz. 100 lbs. lb. doz. lb. lb. oz. lb. bbl. M ft. M ft. August 3.1923 One Month Ago 143.1 151.0 152.4 153.0 161.9 $ 9.80 5.90 12.40 6.95 .9 6 /s -.9 7 / 1.35-1.45 4.85 160.1 $10.05 6.15 15.65 7.05 1.023/6-1.037% 1.35-1.50 4.65 One Y ear Ago 138.3 155.0 155.6 $ 9.65 6.00 12.50 9.20 1.06-1.0854 1.25-1.30 5.55 22.00-23.00tf 27.00-28.75tf 21.25-22.50tf 78.474 81.93* 73.984 6.95 8.25 3.75-4.00 7.50-8.00 .0 6 /-.0 6 / * .0 9 /-.0 9 / .0 9 /-.0 9 / .08 f2.60 t2.25 f2.35 2.65 .4434 .36 .145« 6.704 .625% 6.15-6.204 1.04 20.50 25.00 7.44 9.45 3.75-4.50 7.75-8.75 .0 6 3 / *.io-.ioy2 .0 9 /-.1 0 .10 3.30 2.75 2.35 2.55 .4 2 3 / .32y2 .1 4 /2 6.504 .6 3 /s 5.85-5.90tf 1.04 22.50 26.00 7.15 7.30 10.00-10.50 6.50 .1 1 -.1 1 / .24 .1 2 /-.1 2 / .0 9 /2 3.25 2.60 2.85 2.38 .4154 .2 8 / .14 5.80tf .695/s .6.354 1.95 17.50 17.00 120 M O N T H L Y R EVIEW OF BUSINESS CONDITIONS cent greater than during June, and 30.7 per cent greater than during July, 1922, when 300,729 barrels of flour were produced. That increased production resulted from a more active market demand for flour is shown by the fact that stocks of flour decreased from 492,571 barrels on July 1st to 452,435 barrels on August 1st. Stocks of wheat reported by these companies declined 15 per cent during July. Figures for sixteen milling companies for which a continuous record is kept are given in the following table: July. 1923 Output of F lo u r........... Stocks of F lo u r*........... Stocks of W h e a t * ........ 393,330 452,435 1,233,375 June, 1923 July, 1922 345,342 300,729 492,571 461,185 l,418,798f 1,191,668 * A s o f the first day o f the following month. fR evised figure. Owing to an error in computing the stocks o f wheat held by one o f the reporting milling companies the figure given in the July Review (2,899,607 bushels) was in correct. amount of orders received by reporting mills, on the contrary, increased, the first increase in this item since April. The large excess of pro duction over new orders which has persisted since that month was thus greatly reduced, in dicating that mills have now filled a large part of the record volume of orders received during the first three months of the year, and are reg ulating present production with some regard for current requirements. Stocks of lumber held by the mills have continued below the esti mated normal, 61 mills for which actual figures are available reporting that their present stocks are but 62 per cent of those normally held. Figures showing the activity of approximately 200 reporting mills follow (000 omitted) : July, 1923 (board feet) P r o d u c tio n ................604,376 Shipments .................528,350 Orders ...................... ..495,277 Unfilled Orders___ _429,558 June, 1923 (board feet) 647,408 600,160 482,498 487,690 July, 1922 (board feet) 465,863 435,627 403,829 454,234 M IL L IO N S OF BOARD FE ET 700 THOUSAND BARRELS 9 00 700 500 1922 300 100 0 1923 Lumber Production, Orders Received, and Shipments in Twelfth Federal Reserve District as Reported by Four Lumber Associations. 1922-1923 r¡ i ¡TT i TTP~T7Ti~'i TTT^TTTl PTTT’T'TIT^jri 1922 192 3 Monthly Flour Output, and Stocks of Wheat and Flour at End of Month oí 16 Reporting Milling Companies Production of 44 flour mills reporting through sectional millers' associations in creased 16.9 per cent during July when com- pared with the reported production of 48 mills during June. A large increase of pro duction in the Pacific Northwest caused the increase in the district. Figures follow: N o . of M ills Reporting July June 1923 1923 California . 10 10 Idaho . 2 3 Oregon . 15 17 W ashington . 17 18 District . . . . 44 48 ------- O u tp u t------ July, 1923 June, 1923 (barrels) (barrels) 210,860 212,468 7,469 7,021 134,471 109,993 2 2 3 ,7 3 3 1 6 7 ,6 3 7 576,533 497,119 Per Cent Increase or Decrease (—) July, 1923 June, 1923 Compared Compared with with June, 1923 May. 1923 5.6 — 0.7 6.3 10.3 22.2 28.3 33.4 — 23.3 16.9 — 2.8 Lumber Further declines in production and ship ments of lumber, which were, however, partly seasonal, were reported during July. The The increase in the volume of orders received by mills has followed a quickening of the de mand for lumber in the domestic markets of the Atlantic Coast and some sections of the Middle W est. Perhaps the most significant feature of the lumber trade of this district dur ing recent months has been the increase in shipments to Atlantic Coast markets by way of the Panama Canal. During the first six months of 1923 such shipments were equal to 78 per cent of the total shipments during the entire year 1922, and were more than twice as large as the shipments during the year 1921. The export trade in lumber products of this coast has continued steady, although ship ments have recently decreased owing to a tem porary shortage of cargo space. The usual July shut-down at the logging camps was curtailed this year, as the demand for logs continued unabated and the supply available was but little in excess of current mill demands. Fortunately there have been few occasions for stopping operations on account of forest fires. FEDERAL RESERVE AGENT A T SAN FRANCISCO 121 Mining Petroleum Available preliminary estimates for the month of July show a slight decrease in the production of the principal non-ferrous metals. Dull markets of the preceding three months and the steady decline in prices during that period induced a curtailment of output, par ticularly at mines with high production costs. Final national figures for July are not yet avail able. The figures of national production for June, 1923, May, 1923, and June, 1922, follow: Further increases in production and stored stocks of petroleum in California, and a marked decline in prices of crude oil and gasolene, were reported during July. Daily average produc tion of petroleum in California during that month was 814,906 barrels, an increase of 8.6 per cent over average daily production in June, 1923 (750,570 barrels), and of 118.1 per cent over the corresponding figures for July, 1922 (373,695 barrels). Rapid development of the newer oil fields in Southern California contin ued responsible for the greatly increased pro duction. There were 95 new wells brought in during July with an initial daily output of 161,599 barrels. There were 29 wells abandoned. Consumption of petroleum produced in Cali fornia, although continuing at levels nearly 100 per cent above those of a year ago, has declined slightly during the past two months. Con sumption, as indicated by shipments during Copper (lbs.) June, 1923 M ay, 1923 June. 1922 (mine production) 125,433,000 124,784,916 93,739,847 Silver (oz.) (commercial bars) 5,100,840 6,835,221 4,760,160 Zinc (tons) (slab) ........................ 42,840 47,347 28,547 Figures for lead are not available. Preliminary reports for July contained the first intimation of a reduction in copper output, although production appears to have been maintained at previous levels during that month. Stocks of refined copper in this coun try on July 1, 1923, were estimated at 197,500,000 pounds, the smallest total reported since the end of the war. A slight increase in stocks is reported to have occurred since that date. The market for the other two important in dustrial metals of the district, lead and zinc, has responded quickly to the stimulus of les sened output and renewed demand. The price of zinc (St. Louis market) advanced from 5.75 cents per pound on July 2, 1923, to 6.25 to 6.35 cents per pound at the close of that month. Similarly the price of lead (New York spot) advanced from 6.50 to 6.70 cents per pound during the month. Silver miners are still en gaged in adjusting their production to conform with present market conditions now that gov ernment purchases at the price of $1.00 per ounce fixed by the Pittman Act have been com pleted. Those mines whose principal product is silver are mining on a light schedule or have temporarily closed down. The market price of silver at New York declined from 63$4 to 6 2 ^ cents per ounce during July. Average prices paid for copper, lead, silver, and zinc during July, 1923, June, 1923, and July, 1922, follow : ^ /1 t N n / — —...—1Average Prices July. 1923 June. 1923 July. 1922 Copper (lb.) (c e n ts ) N ew Y o rk Electrolytic.. 14.32 Lead (lb.) N ew Y o r k .......................... 6.24 Silver (oz.) N ew Y o rk F oreign......... 63.015 Zinc (lb.) St. L o u i s ............................. 6.09 (c e n ts ) (c e n ts ) 14.91 13.90 7.14 5.72 64.86 70.24 6.62 5.69 M IL L IO N S C A L I F O R N IA Production, Shipments, and Stored Stocks of Petroleum, and Refinery Stored Stocks of Gasolene. 1922-1923 July, amounted to 620,762 barrels per day, a decline of nearly 30,000 barrels from the June figures. Average daily consumption has been far below production, and stored stocks on August 1, 1923, at 78,655,604 barrels, were 6,018,457 barrels or 8.3 per cent greater than on July 1, 1923. On August 1, 1922, stored stocks amounted to 45,187,910 barrels. Prices paid for crude oil in all fields except those of Ventura County were reduced on August 1, 1923. The new price list contained reductions ranging gradually upward from 1 cent per barrel on oil of 20-20.9 degrees grav ity to 41 cents per barrel on oil of 35 degrees gravity and above. On the same date a general 122 M O N T H L Y R EVIEW OF BUSINESS CONDITIONS reduction of 2 cents per gallon in the price of gasolene in the Pacific Coast territory was an nounced by distributors. New prevailing prices per gallon in some of the principal cities of the district were then: San Francisco and Los Angeles, 17 cents; Portland, 21 cents; and Tacoma, 19 cents. Prices for gasolene are now lower than at any time since 1916. A state ment of pre-war, peak, and present prices of petroleum and gasolene follows: Present Crude Petroleum— Southern Cali fornia Fields— 25° gravity (per barrel)* ............................................... $0.73 Gasolene — San Francisco (p e r gallon) f ..................................................... 17 Peak Pre-W ar $1.96 $0.55 more power during the later month. Consump tion of electric energy at the mines of the dis trict declined slightly from May to June. Figures showing the number of industrial consumers and industrial sales of reporting companies during June, 1923, and June, 1922, follow : Number of Industrial Consumers June, June, 1923 1922 51,474 California ................... 71,055 Pacific Northwest . . 12,191 10,840 Intermountain States 2,857* 3,123* Tw elfth District . . . . .27 Industrial Sales K .W . H . June, June, 1923 1922 259,469,731 212,005,029 86,103 65,437 71,407,928 62,490,230 64,316,835 50,807,319 393,367,889 327,129,178 *D ue to a change in the statistical method o f one reporting com pany these figures are not comparable. .155 *Field price, tService station price. Increased foreign and domestic demand for gasolene during June resulted in an excess of consumption over production amounting to approximately 22 per cent. As a consequence stored stocks of gasolene at refineries in Cali fornia declined from 147,125,960 gallons on June 1, 1923, to 142,859,892 gallons on July 1, 1923. Stocks on the latter date were still 4.5 per cent greater than those held on May 1, 1923, and 194 per cent greater than stocks at refineries on July 1, 1922. Retail Trade Sales of 35 reporting department stores in this district during July, 1923, were 19.8 per cent greater in value than during July, 1922. This is the largest increase over the same month in the preceding year recorded since M IL L IO N S OF D O L L A R S Electric Energy Throughout the first six months of the pres ent year sales of electric energy for industrial purposes in this district have been greater by approximately 20 per cent than in the corre sponding months a year ago. Sales of 20 re porting companies during June, 1923, were 20.2 per cent greater than during June, 1922, all lines of industry for which separate figures are available participating in the increase. The largest gain in sales of power, 32 per cent, was to the general manufacturing industries, fol lowed by the lumbering and petroleum indus tries whose purchases increased by 25.5 and 20.9 per cent respectively. Percentage com parisons of sales of 20 of the principal power companies by certain industries and by sec tions of the district are presented in the fol lowing table: Percentage Increase or Decrease (—) June, 1923, compared with June, 1922 Total AgriculM anuIndustrial ture Mining factoring Sales California ........................... 14.4 — 4.3 29.1 22.3 Pacific Northwest .......... 1.2 33.1 48.7 11.0 Intermountain States . . 5.4 18.2 16.2 22.9 Tw elfth District .............. 13.6 8.5 32.0 20.2 Figures of total sales for June, 1923, show an increase of 9 per cent over May, 1923, almost wholly due to an increase in the needs of agri cultural consumers who used 64.5 per cent Net Sales of 31 Department Stores in Twelfth Federal Reserve District (in M illion s o f D ollars) March, 1923, when the increase was "21.2 per cent. Compared with June, 1923, the sales of July, 1923, were 9.1 per cent less in value, a seasonal decline which has occurred in similar degree in each July since 1919, when this bank first began compiling records of retail trade. Stocks of goods held by reporting stores declined slightly during July, the decrease amounting to 1.1 per cent. The value of stocks (selling price) on August 1, 1923, was 10.1 per cent greater than the value of stocks held by the same stores on August 1, 1922. The aver age annual rate of stock turnover indicated by the figures of sales and stocks for July, 1923, was 2.6 compared with a rate of 2.4 for July, 1922. The average annual rate of stock turn over for the first six months of 1923 was 2.9, and for the same period in 1922 it was 2.6. 123 FEDERAL RESERVE AG EN T A T SAN FRANCISCO A detailed statement of the percentage changes in the value of sales and stocks of re porting department stores in this district fol lows : Percentage increase or decrease (— ) in value of sales July, 1923, compared with N o. of July, June, Stores 1922 1923 Percentage increase or decrease (— ) in value of stocks July, 1923, compared with July, June, 1922 1923 Percentage increases or decreases (— ) in the value of July sales of all reporting firms in each line of business are presented in the following table: Seven Months Ending July 31, July. 1923, 1923, corncompared with pared with July, June, same period in 1922 1923 1922 Number of Firms 2.2 12.4 -— 11.1 19.2 13.8 20.2 20.3 8.8 12.9 7.5 19.5 ^Figures for one store included in district figures, but not in cluded in figures for cities shown above. Wholesale Trade Foreign Commerce and Shipping There was little change in the condition of trade at wholesale during July, the usual sum mer quiet prevailing in most lines of business. O f the eleven lines which report the value of their sales to this bank, nine showed increases during July, 1923, as compared with July, 1922, the exceptions being agricultural equipments and automobile tires. Sales of drugs, electrical equipment, furniture, and stationery increased by 15 per cent or more during the year period. The value and volume of foreign trade trans acted through Pacific Coast ports increased greatly during the first six months of 1923 as compared with the first six months of 1922. As in the foreign commerce of the country as a whole, the import trade was most active on this Coast, each of five customs districts re porting substantial gains. In the export field the aggregate value of trade passing through all customs districts was slightly greater in 1923 than in 1922, but the ports of the Pacific Northwest did not share in the increase, due to a marked decline in shipments of wheat, one of the principal export commodities of the sec tion. Figures received from five customs dis tricts follow: 6 4 4 10 5 5 33.3 9.9 12.9 16.0 3.8 11.4 D is t r ic t * ........... 35 19.8 — 2.5 — 27.9 — 23.3 — 5.6 — 14.4 — 20.1 16.3 9.3 — 19.1 12.5 6.3 4.1 — 9.1 10.1 2.5 — 1.1 — 7.6 — .6 — 8.2 — .1 — 1.1 JULY PRICES 1922=100 %=JULYI922 SALES U.S.BUREAU OF LABOR INDEX NO. WHOLESALE PRICES AGRICULTURAL IMPLEMENTS -- 12.6 24.8 14.3 12.4 22.2 36.3 32.3 14.2 28.6 12.7 21.0 Agricultural Implements 23 Autom obile Supplies___ 19 Autom obile T ir e s ............ 17 9 D ry G oo d s........................... 15 Electrical E q u ip m en t... 5 Furniture ............................ 16 Groceries ............................ 28 Hardware ........................... 20 13 Stationery .......................... 29 Los A n g ele s......... Oakland ................ Salt Lake C i t y ... San Francisco. . . . Seattle ................... Spokane ................ — 8.6 — 11.3 9.9 5.6 3.7 — 1.1 — 24.9 — .8 — 12.9 — 9.9 — 5.1 AUTOMOBILE SU PPL E S AUTOMOBILE TIRES January* IM P O R T S June, 1923 Los A n geles............ $ 13,605,992 5,606,962 O regon (Portland) San Francisco . . . 99,169,696 W ashington (Seattle-Tacom a) 110,312,508 DRUGS DRY GO OD S F U R N IT U RE GROCERIES Totais ............... $228,695,158 HARDWARE EXPORTS Los A n g e le s............ $ 16,913,276 Oregon (Portland) 16,527,436 San Francisco . . . . 69,587,501 W ashington (Seattle-Tacom a) 48,203,877 SH O E S S T A T IO N E R Y 20 40 60 80 100 120* 140 Dollar Value of Sales of Representative Wholesale Firms and General Wholesale Prices in July, 1923, compared with July, 1922 An increasing number of firms is reporting collections as “fair” instead of “good” or “ex cellent.” Collections during the past three months have been reported as follows: Number of Firms Reporting Collections as Excellent Good Fair Poor 69 56 43 JanuaryJune, 1922 7,784,700 3,820,698 83,919,142 89,287,109 23.5 $184,811,649 23.7 $ 8,783,065 27,088,867 57,427,985 92.5 38.9* 21.1 1.1* 48,759,734 160 Totals M ay, 1923............................... 6 June, 1923............................... 3 July, 1923............................... 5 $ Percentage Increase 1923 Compared with 1922 74.7 46.7 18.1 60 72 75 6 8 8 ............... $151,232,090 $142,059,651 ' 6.4 * Decrease. Domestic coastal and intercoastal commerce of these ports during the first six months of 1923 was greater by from 25 to 100 per cent than during the first six months of 1922. The large increase in intercoastal trade was directly reflected in figures on the amount of traffic passing through the Panama Canal, of which traffic intercoastal trade forms a principal part. Cargo tonnage moving through the canal dur 124 M O N T H L Y R EVIEW OF BUSINESS CONDITIONS ing the first six months of 1923 exceeded the movement during any previous twelve month period. Large shipments of petroleum from California to Atlantic-Gulf Coast ports were primarily responsible for this record move ment. Figures on commercial traffic through the canal for the past four fiscal years follow : Fiscal Year N o . of Vessels 1920 .2,478 1921 .2,892 1922 .2,736 1923 (July-Decem ber) . . . . 1,640 1923 (January-June) ............ .2,327 Cargo Tonnage 9,374,499 11,599,214 10,884,910 7,923,063 11,644,812 Ocean freight rates continued at relatively low levels during the first six months of 1923, increases on some items being offset by de creases on others. A general advance in inter coastal freight rates averaging approximately 30 per cent went into effect on August 1st. Employment Shortages of certain classes of labor reported one month ago have practically disappeared. The lack of harvest hands, which was threat ening in the Pacific Northwest last month, has not become serious, and thus far harvesting of the district’s crops has not been generally de layed because of the inability of farmers to secure sufficient help in the fields and orchards. A small but general decline in building activity has relieved the previously noted shortage of building trades craftsmen, although employ ment in this industry is still readily obtainable. A slight scarcity of plasterers and sheet metal workers has been reported from several sec tions of the district. The closing of some silver mines and the curtailment of production at others has lessened the demand for experienced miners, and the supply of workers in that in dustry is now more nearly equal to the demand than has been the case for some time past. In the Mother Lode district of California, how ever, a shortage of miners serious enough to cause a noticeable curtailment of production has recently been reported. W ages in this re gion have advanced approximately 50 cents a day. Activity in the lumber industry continued during July, and lumber workers are reported to be fully employed in most sections of the district. In some lumbering regions there is a slight surplus of common laborers and a corre sponding shortage of skilled laborers. The oil fields of California are still operating below capacity, and in the older producing regions of the San Joaquin Valley considerable unem ployment is reported. The following figures based on the reports of 40 large firms usually employing 501 or more men give a comparison of employment condi tions in manufacturing industries during July, 1923, and 1922: P c r C ent Number Increase July, of Number of M en on Payroll 1923, over Firms July. 1923 July, 1922 July. 1922 Los A n g e le s.......... P o r tla n d ................. San Francisco___ Seattle .................... 16 8 10 6 32,846 9,233 8,291 2,508 27,272 6,645 7,092 2,159 20.4 39.2 16.9 16.2 Compared with June, 1923, figures for July, 1923, show increases in Portland, San Fran cisco, and Seattle, and no change in Los Angeles. Figures recently collected by this bank show that employment in retail and wholesale mer chandising establishments has increased during the past year as it has in the industries. There was an increase of 6.0 per cent in the number of workers on the payrolls of 23 reporting re tail stores on July 1, 1923, as compared with July 1, 1922, and an increase of 8.4 per cent in the figures reported by 100 wholesale firms as of the same two dates. Automobile Registrations Figures of new automobile registrations continue to evidence the increased purchas ing power of the district’s population as com pared with one year ago. In four states for which comparative data are available there were 51.1 per cent more new passenger cars and 24.6 per cent more new commercial vehicles registered during June, 1923, than during June, 1922. During the first six months of 1923 as compared with the same period in 1922, there was an increase of 82.8 per cent in the registration of new passenger cars, and registrations of new trucks increased by 45.8 per cent. Figures showing registrations of new automobiles in the states of this district (except Nevada, for which figures are not available) for the first six months of 1923 and 1922 are presented in the following table: Total New Passenger Cars Registered Jan. 1 to July 1 1923 1922 Arizona ................. C a lifo rn ia ............. Idaho ..................... O r e g o n .................. Utah ....................... W ashington ........ 4,917 1,801 114,745 66,346 4,795 2,292 16,417 6,636 6,241 * 18,899f 8,353 Total (4 states) 140,875 ‘ N ot available. 77,075 Total New Commercial Cars Registered Jan. 1 to July 1 1923 1922 383 11,784 307 727 648 1,994+ 13,201 102 8,174 221 555 * * 9,052 f T o June 1st only. Total registrations of old and new automo biles in six states of the district (figures for Nevada are not available) during the first seven months of 1923 amounted to 1,468,927, an increase of 27.5 per cent over the 1,152,520 cars registered in the first seven months of 1922. 125 FEDERAL RESERVE A G E N T A T SAN FRANCISCO Building Activity Reports of a slight slackening in the de mand for building trades workers indicate that the volume of construction in this district de creased in July as compared with June and the months immediately preceding. There was a noticeable decline in the number and value of building permits issued, but how much of this movement was seasonal and how much due to the uncertainty of prospective builders regarding the cost of building dur ing coming months cannot yet be ascertained. Percentage Increase or Decrease^— ) in the Number and Value of Building Permits issued in 20 Cities July, 1923, compared with July. 1922 June 1923 Number of Permits Issu ed................ Value of Permits Issued.................... 16.1 42.6 — 7.5 — 19.0 The cost of building materials, as shown by the index number of the United States De- partment of Labor, declined 2.06 per cent dur ing the past month. A s compared with a year ago present building materials costs show an increase of 11.7 per cent. Inasmuch as this increase is considerably less than the increase in the value of building permits issued in this district over the year period, it appears likely that the evidence of an increase in the physical volume of building afforded by figures of the number of permits issued is correct. Comparative figures of the number and value of building permits issued in 20 cities of the district during July, 1923, and July, 1922, are presented in table “ B.” Business Failures The number of business failures in this dis trict was 5.33 per cent smaller in July, 1923, than in June, 1923, and the amount of liabil ities involved, although larger than in the LIA BILIT IES IN M ILLIO N S NO. OF FA IL U R E S 10 250 V V A NO. OF 1 ' w ' rA I L U R E S \ A V V 1“ 1 .1 /' ' / \ / r v' X ' \ \/ * V / / \ 200 ' A 150 IOO IL IT IE S 1 s 1. 1 1 .1... 1, i K s*— - 1__ L . I.. 1 ...1 1922 1 i. 50 - » 1— 1 _.,L 1923 Business Failures, Twelfth Federal Reserve District. 1922-1923 Building Permits Issued in 20 Principal Cities, Twelfth Federal Reserve District. 1922-1923 (B) Building Permits— July, 1923 Value N o. 222 25 136 339 Los Angeles.. 4,722 892 Oakland ......... Ogden ............. 25 332 Pasadena ____ Phoenix ......... 55 Portland....... 1,059 Reno ................ 23 Sacramento . . 263 Salt Lake City 120 San D ie g o .. . . 363 San Francisco 733 79 San Jose.......... 890 Seattle ......... Spokane ....... 205 82 Stockton ........ Tacom a ......... 373 Berkeley ........ B o i s e ................ Fresno ............ Long- B ea ch .. D is t r i c t ___ 10,938 N o. July, 1922 Value 444,700 25,305 271,916 1,377,332 15,083,273 1,947,324 58,290 760,079 94,242 1,532,115 40,132 1,065,330 676,025 1,177,045 3,227,115 157,480 3,122,315 181,645 323,740 386,445 101 85 133 208 3,393 721 41 308 45 1,313 29 213 159 369 595 79 842 248 109 424 $ $31,951,848 9,415 $22,391,016 $ 527,250 49,906 370,288 535,884 8,064,018 1,900,712 87,660 987,826 137,082 2,206,615 69,120 367,858 569,951 710,006 3,024,036 166,245 1,559,205 273,022 409,196 375,136 previous month, was less than in any other month since May, 1921. Compared with July, 1922, failures during July, 1923, were less both in number and liabilities, the decline in each case approximating 7.5 per cent. The aver age liabilities of business failures in this dis trict during July, 1923, were $13,415 com pared with $10,478 in June, 1923, and $13,540 in July, 1922. R. G. Dun and Company’s figures of the number and liabilities of business failures in the states of this district during July, 1923, and June, 1923, follow: N o. Arizona ......... .. California . . . . , . . . U t a h ................. . W ashington . . . . District 2 77 5 1 22 8 27 . . 142 July, 1923 Liabilities $ N o. June, 1923 Liabilities 84,500 1,074,872 122,071 3,800 217,914 128,112 273,664 74 5 849,910 93,489 22 8 41 203,751 16,701 407,120 $1,904,933 150 $1,570,971 Bank Debits A greater than seasonal decline in individual accounts at banks in 21 house centers during July, 1923, indicates that the total volume of business transacted dur ing that month was less than in June, 1923, 126 M O N T H L Y R EVIEW OF BUSINESS CONDITIONS and, if allowance be made for seasonal vari ations, less than in any month since Febru ary, 1923. Compared with July, 1922, the fig ures for July, 1923, .show an increase of 18.4 per cent, but this increase is also the smallest reported in any month since February, 1923, when comparision has been made with the corresponding month a year ago. The per centage increase over 1922, as in previous months, is considerably greater than the in crease in commodity prices over the year period, indicating that the physical volume of business transacted remains greater than one year ago. Part of this increase is due, of M IL L IO N S OF D O L L A R S 2800 2600 course, to the normal growth and develop ment of the district, but the amount of the in crease makes it seem probable that there is greater activity in trade now than in 1922. Considered geographically, bank debits dur ing July, 1923, increased as compared with July, 1922, in 16 of the 21 cities, the excep tions being Pasadena, Phoenix, Reno, and Yakima. The figures for Sacramento, which show a decline of more than 40 per cent for the year period, must be disregarded, as one of the largest banks in that city has changed its method of reporting bank debits, and thus temporarily destroyed the value for compar ative purposes of the figures for that city. Detailed figures of bank debits by cities during July, 1923, and July, 1922, are pre sented in table “ C” . Savings Accounts The amount of all savings deposits in 75 banks in seven principal cities of the district increased from $934,834,000 (revised figures) on June 30, 1923, to $936,123,000 on July 31, 1923, a gain of 0.1 per cent. Two of the three California cities included in the reports sho'Cv losses for the month of July, and the third a smaller increase than was reported by cities in all other sections of the district. Compared 2400 2200 2000 IÔ 0 0 M IL L IO N S OF D O L L A R S 1000 Debits to Individual Accounts in 20 Principal Cities, Twelfth Federal Reserve District. 1922*1923 500 400 300 (C) Bank Debits*— Four weeks ending Aug. 1.1923 B e r k e le y ...........................................$ Boise ................................................. Fresno ............................................. L o n g B each.................................... L os A n g ele s....... ............................. Oakland .......................................... O gden .............................................. Pasadena ........................................ Phoenix ........................................... P o r t la n d ........................................... Reno ................................................. Sacramento .................................... Salt Lake C ity ............................... San D ie g o ....................................... San Francisco................................. San J ose............................................ Seattle .............................................. Spokane ........................................... Stockton .......................................... Tacom a ............................................ Yakima ............................................ 16,039 12,390 43,946 55,676 671,798 113,310 23,297 28,359 14,780 147,594 9,967 33,965 55,287 45,581 709,404 20,476 158,957 45,602 24,210 37,405 8,374 Total ............................................. $2,276,417 *000 Omitted. Four weeks ending Aug. 2.1922 $ 14,375 11,135 40,760 35,909 476,051 77,227 15,779 23,237 15,135 123,935 10,164 56,902 52,055 36,834 675,287 19,464 134,945 39,354 19,871 35,285 8,960 $1,922,664 200 100 50 40 30 LT L A K E C IT Y 20 SPOKANE 10 1922 192 3 Savings Accounts in Banks in Seven Principal Cities of the Twelfth Federal Reserve District, 1922*1923 N ot e : It has been necessary to revise the published figures for Los Angeles (and therefore for the district as a w hole), be cause, due to a misunderstanding o f the definition of "savin gs accounts,” figures reported by individual banks there were not strictly comparable. General trends in both Los Angeles and the district are unchanged. FEDERAL RESERVE AG EN T A T SA N FRANCISCO with July, 1922, the district figures for July, 1923, show an increase of 16.6 per cent. Los Angeles and Seattle continue to report the largest percentage increases over the year period. Detailed changes in the amount of savings deposits since one month ago and one year ago as reported by 75 banks in seven cities follow: PerCent Number of Reporting Banks Salt Lake City. Increase or Decrease (— ) July, 1923, compared with June, 1923 July. 1922 13 7 9 8 16 16 6 23.7 17.1 19.5 11.8 10.7 21.7 12.9 .7 — .4 2.6 1.2 — .8 1.2 2.4 75 16.6 .1 127 of approximately 775 reporting member banks in the principal cities of the United States, on the other hand, have been gradually declin ing since May 2nd. Investments of the re porting banks in this district declined $3,000,000 during the four weeks ended August 8th, whereas during the four weeks ended July 3rd they had increased $3,000,000. The trend of these investment holdings has been down ward in this district since the middle of May, and it has been downward in the reporting banks of the country as a whole since January. Total deposits of reporting banks in the district declined $11,000,000 during the four weeks ended August 8th, compared with an advance of $7,000,000 during the four weeks M I L L I O N S OF DO LLA RS *Includes one bank in Berkeley which was formerly a branch of an Oakland bank. Banking and Credit Situation Total loans of 66 reporting member banks in the principal cities of the district increased $16,000,000 during the four weeks ended August 8th. During the previous four weeks they had increased but $1,000,000. A change M I L L I O N S OF D O L L A R S Total Reserves, Federal Reserve Note Circulation, Bills Discounted, and Investments, Federal Reserve Bank of San Francisco 400 IN V E S 1 M E N T S ■ - 3 00 100 50 B IL L S PA Y A B L E A N D R E D I: ¡ C O U N T S 1922 1923 Total Deposits, Loans and Discounts, Investments, and Bills Payable and Rediscounts of Reporting Member Banks N o t e : The break in the lines indicates a change in the composi tion of the list of reporting banks. in the composition of the list of reporting banks prevents exact comparisons of current figures with those reported previous to July 11th, but it is probably true that total loans of member banks now reporting have reached a new high point for the year. Total loans ended July 3rd. Total deposits of these banks have been, with minor fluctuations, compar atively stable since early in April, this period of stability following a steady advance which had been in progress for approximately a year. Total deposits of reporting member banks in the country as a whole reached their peak in January, 1923, and since the middle of May have been declining. Total discounts of the Federal Reserve Bank of San Francisco declined $8,000,000 during the four weeks ended August 15th, after having increased $23,000,000 during the four weeks ended July 11th. A t $73,000,000 on August 15th they were $42,000,000 greater than on January 10th, when they reached the lowest point in recent years. Investments of the Reserve bank declined $2,000,000 during the four weeks ended August 15th, a continu ation of a movement which has been in prog ress throughout the present year. This de cline in the amount of investment holdings of the bank has been greater than the increase in total discounts, and total earning assets on August 15th were $23,000,000 less than on 128 M O N T H L Y R EVIEW OF BUSINESS CONDITIONS January 10th. Excepting June 20, 1923, total earning assets are now the smallest since March, 1922. The amount of Federal Reserve notes in circulation on August 15th was $7,000,000 less than on July 3rd (there is a normal sea sonal increase in circulation at the end of the fiscal year and over the 4th of July holiday), but was still $15,000,000 greater than on April 25th, when the amount of notes in circulation was the smallest in recent years. Interest rates at New York advanced dur ing the first 10 days of August, the rate on time money increasing from 5 per cent to 5*4 per cent and the rate on commercial paper in creasing from 5 to 5}£ per cent. This harden ing may have been partly due to seasonal in fluences, but it is noteworthy that the com mercial paper rate is now 1% Per cent higher than it was at this time last year. The aver age rate charged by large San Francisco banks on loans to borrowers continued dur ing July at 5 y 2 per cent. Dullness has characterized the acceptance market in this district during recent weeks. Reports received by this bank from 35 of the principal accepting banks of the district show the following changes in the amount of bills purchased and accepted during July, 1923, com pared with June, 1923, and July, 1922: July, 1923, compared with June, 1923 July, 1922 Am ount of bills accepted . . . . Am ount of bills b o u g h t ........... Am ount of bills held at close of month ................................... + 1 8 .5 % + 7.3% — 17.0% — 62.2% — 30.8% -— 54.6% PRINCIPAL RESOURCE AND LIABILITY ITEMS OF REPORTING MEMBER BANKS IN RESERVE CITIES IN TWELFTH FEDERAL RESERVE DISTRICT August 8.1923 N u m b e r o f R e p o r t in g B a n k s .......................................................................... 66* Loans and Discounts (including rediscounts)......................................$ 995,684,000 Investments ............................................................................................................. 349,073,000 Cash in Vault and with Federal Reserve B ank................................... 118,108,000 Total D e p o s i t s . . .. ................................................................................................ 1,275,900,000 45,293,000 Bills Payable and Rediscounts with Federal Reservé B an k ........... July 11.1923 August 9.1922 66* $ 979,965,000 352,868,000 128,720,000 1,287,056,000 56,853,000 68* $ 863,027,000 334,555,000 104,934,000 1,184,485,000 9,362,000 *D ue to changes in the composition o f the list o f reporting banks, current figures are not exactly comparable with those o f a year ago. COMPARATIVE STATEMENT OF CONDITION OF FEDERAL RESERVE BANK OF SAN FRANCISCO AT CLOSE OF BUSINESS, AUGUST 15, 1923 RESOURCES July 18. 1923 August 16. 1922 Total Reserves.........................................................................................................$277,821,000 Bills D iscounted..................................................................................................... 73,440,000 Bills Bought in Open M arket.......................................................................... 14,895,000 United States Government Securities........................................................ 9,185,000 August 15.1923 $263,956,000 81,590,000 16,641,000 9,185,000 $259,093,000 43,388,000 17,702,000 53,977,000 T otal Earning A s s e ts ...........................................................................................$ 97,520,000 A ll Other R esources*......................................................................................... 56,692,000 $107,416,000 56,675,000 $115,067,000 45,656,000 Total Resources................................................................................................. $432,033,000 $428,047,000 $419,816,000 Capital and Surplus..............................................................................................$ 22,992,000 Total D eposits........................................................................................................ 154,628,000 Federal Reserve Notes in Actual Circulation........................................ 210,860,000 A ll Other Liabilitiesf......................................................................................... 43,553,000 $ 23,071,000 152,671,000 210,244,000 42,061,000 $ 22,789,000 141,308,000 216,013,000 39,706,000 Total Liabilities................................................................................................. $432,033,000 $428,047,000 $419,816,000 L IA B IL IT IE S ♦Includes ‘‘Uncollected Item s” ....................................................................... flncludes “ Deferred Liability Item s'’ .......................................................... 42,746,000 41,690,000 40,574,000 40,316,000 38,914,000 35,172,000 CORRECTION In the *Summary of Provisions of the Agricultural Credits Act of 1923,” dated July 16, 1923, and recently mailed to those who receive the Monthly Review of this bank, the maximum rate of interest for which it is competent for persons to contract in California should be changed from "no limit” to 12 % . This item occurs in the middle of the inside pages under the caption "Rate of Interest.”
@FedFRASER